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ANALYSIS OF RESOURCE USE EFFICIENCY AND PROFITABILITY IN CHILLI PEPPER (Capsicum frutescens) PRODUCTION AND ITS CONTRIBUTION TO HOUSEHOLD FARM INCOME IN KADUNA STATE
Abstract:
Chilli pepper (Capsicum frutescens) is one of the major cash crops grown in Nigeria. This study seeks to determine the resource use efficiency and profitability in chilli pepper production and its contribution to household income in Kaduna state. Purposive and simple random sampling techniques were adopted in sampling the respondents. Descriptive statistics, net farm income, multiple regression analysis, stochastic frontier production function were used in estimating the result, using cross-sectional data of 200 farmers from the three major chilli pepper production area namely Ikara, Kubau and Soba. The findings of the analysis reveal that 56% of the respondents fall within the age range of 30-49years, Majority of the farmers (53%) had formal education. Household sizes ranged from 6-10 persons represent 33.5% of the respondents. Farmers with 6-10 years of farming experience constitute 24%. Majority of the farmers (72%) were not members of a cooperative society. Also 98.5% of the farmers financed their production through personal saving and 45.5% of the chilli pepper farmers have access to extension services of 1-2 times per season. The total revenue and costs in chilli pepper production were estimated as ₦111,857 and ₦45,881 respectively. The net farm income was therefore ₦65,976. The average rate of return on investment (return per naira invested) was ₦2.44, indicating that for every ₦1 invested in chilli pepper production a return of ₦2.44 was made. Thus, it could be concluded that chilli pepper production in the study area is profitable. The result of the multiple regression analysis revealed that the socio- economic variables i.e. education, farming experience and credit borrowed had significant influence to profitability either positively or inversely at different level of probability. The result of Cobb-Douglas stochastic frontier production function used to estimate technical efficiency of the farmers shows that the mean efficiency was 0.90 and It was observed from the study that 12% of the farmers had technical efficiency of less than 0.81 level efficiency while 88% of the farmers operate at 0.81 and above level efficiency. The farmer with the best and least practice had a technical efficiency of 0.98 and 0.74 respectively. Also 90% of the farmers were estimated to have technical efficiency exceeding 0.8, indicating there are some 10% technical inefficient farmers in the study area. The result of the contribution of crops to the average household farm income revealed that chilli pepper contributed 42% to the total household farm income compare to other crops produced by chilli pepper farmers in the study area. Price variation and high cost of inputs were the major constraints face by the chilli pepper. Findings further revealed that none of the sampled chilli pepper farms reached the frontier threshold however within the context of efficient agricultural production, output can still be increased by 10% using available inputs and technology and concluded that investment in chilli pepper production is a viable enterprises. Its recommended farmers should join cooperative association to enable them procured fertilizer and other agricultural inputs at the subsidised rate.
ANALYSIS OF RESOURCE USE EFFICIENCY AND PROFITABILITY IN CHILLI PEPPER (Capsicum frutescens) PRODUCTION AND ITS CONTRIBUTION TO HOUSEHOLD FARM INCOME IN KADUNA STATE
